Unit 6. Advertising.

What makes Nike's advertising tick?(48th page)

By Stefano Hatfield

Phil Knight, the co-founder and former Chief Executive of Nike, prefers to let his superstar athletes and (#5) advertisements do his talking for him. Named Advertiser of the Year at the 50th Cannes International Advertising Festival, he is the first person (#10) to win the award twice.

Knight has an absolutely clear and committed strategy to use celebrity athlete endorsement. He describes it (#15) as one part of the 'three-legged stool' which lies behind Nike's phenomenal growth since the early 1980s, with the other two being (#20) product design and advertising.

He has built Nike's expansion into sport after sport from its athletics roots (#25) on the back of sporting masters; Carl Lewis on the track; tennis's Jimmy Connors and John Mdinroe; Tiger Woods, who led Nike into (#30) golf; Konaldo and the Brazilian national football team; and the basketball star, Michael Jordan, who famously rescued the (#35) company.

From the beginning Nike has been prepared to take a gamble on sporting bad boys others would not touch: Andre (#40) Agassi springs to mind. It was a strategy that began with Hie Nastase, the original tennis bad boy. The Romanian had the quality that has come to (#45) represent Nike and its advertising: attitude.

After extraordinary growth, Nike became number one trainer manufacturer in the (#50) US. But Knight admits the company then lost its way as it failed to cope with its success. It experimented unsuccessfully with expansion (#55) into non-athletic shoes, and lost its number one position to Reebok in 1986.

Knight bet the future of the company on a new feature; a (#60) new air technology inside the Irainer. He launched the product with a David 1'inchet-directed ad which used the Beatles track Revolution, and (#65) then marketed the Air Jordan brand on the back of Michael Jordan. Sales took off and the rest is history.

This brings us to the subject (#70) of globalisation and the question of how American the brand can be. Nike uses a mix of global ad campaigns such as 'good v evil' and local (#75) advertising such as its famous poster campaigns in the UK. During a 21-year partnership with the agency Wieden and Kennedy, Nike (#80) has created some of the world's most attention-grabbing advertising: for example the Nike 'good v evil' campaign and two (#85) advertisements both for World Cups and the ad 'tag', last year's Cannes grand prix winner. Other famous ads star Pete Sampras and Andre (#90) Agassi playing in the streets of Manhattan; Tiger Woods playing 'keepy-uppy' with a golf ball; and Brazil's team playing soccer at the airport (#95) terminal.

It is a remarkable body of work, both in its variety, daring and consistent originality. At Nike there is a (#100) streamlined decision-making process that gives marketing directors real power. They do not rely on market research pre-testing which often (#105) reduces the impact of more experimental commercials. There is also the long relationship with one of the world's best ad agencies, and (#110) what Wieden describes as 'an honesty about sport'. Things only happen in Nike ads that sportsmen and women can really do.

(#115) 'My number one advertising principle - if I have one - is to wake up the consumer,' concludes Knight, with an absolute conviction that is (#120) unique among modern-day chief executives. 'We have a high-risk strategy on advertising. When it works, it is more interesting. There (#125) really is no formula.'

From The Guardian

Business brief.

Whetheror not you agree with communications guru Marshall McLuhan that advertising was the greatest art form of the twentieth century, it is a big part of modern culture. Shared references feed into it and it in turn feeds into daily life: advertising catch phrases turn up in TV comedy sketches and everyday conversation. And we become 'ironic' about advertising, perhaps to show that we think we are able to resist it.

TV advertising is still the most glamorous, even if its heyday is over with the proliferation of channels and the saturation of the markets (at least in advanced economies) of the consumer goodsit normally promotes. But the other mediaare not to be ignored: radio, cinema and the press, while hoardings(BrE) and billboards(AmE) are an integral part of the urban landscape. All these will be around for some time. Internet advertisingexpenditure is on the increase again. Some people find pop-up advertisementshave become a major source of irritation, but others find them a useful source of information.

Advertising can be continued by other means, with sponsorshipof particular events or product placementin films. This latter is where the product's makers negotiate for their products to appear and be used by the film's characters. A related phenomenon is product endorsement,where a celebrity is used in advertising aparticular product. This can be dangerous if, for whatever reason, the celebrity falls from favour.

Some verycreative minds come up with seductive combinations of sound, image and words, but tests show that we often don't remember the brand being advertised. Quantifying the effect of advertising is very difficult and there has been a backlash against it in favour of other, supposedly more targeted,forms of communication. This usually means direct marketing,otherwise known as direct mailbut, as those li/ing in apartments whoreceive mailshotsfor gardening products know, the targeting can still be ludicrously imprecise.

Advertising agenciesmay offer to run directmail campaigns, but what theyare best at is creating traditional advertising campaigns.When a client becomes dissatisfied and the agency loses the accountthis is major news in tr.e advertising industry and means a big loss of revenue (and self-esteem) for the agency. Agencies develop a creative brieffor clients, with proposals onthe ideas to be used in the campaign. One key problem is reaching the right target audience(for example, young women between 18 arid 30), so the selection of media(the right TV channels, magazines, etc.) is very important. And the advertising must fit into the company's overall marketing strategy- its plans on how it will compete and succeed in particular markets,

All these activities, all this expenditure. But the ultimate in advertising is word-of-mouth:friends and colleagues are oftenour most reliable sources of information. This form of advertising is usually free. All the advertiser can do is hope thatit is positive.